Improvements to the SSDI and SSI Work Incentives and Expanded Availability of Health Care Services to Workers with Disabilities under the Ticket to Work and Work Incentives Improvement Act of 1999
ICI Policy Brief #2
Center on State Systems and Employment (RRTC)
Center on Workforce Investment and Employment Policy (RRTC)
Table of Contents
Background about Federal Income Maintenance and Federal Health Care Programs (prior to Enactment of the Act)
- The SSDI Program
- The SSI Program
- The Definition of Disability under the SSDI and the SSI Programs
- Work incentive provisions in the SSDI and SSI programs and related Federal health care programs
- The Medicare Program and SSDI Beneficiaries
- The Medicaid Program and SSI Beneficiaries
Provisions in the Act
- Reduction of Work Disincentives
- Expanded Availability of Health Care Services
- Expanding State Options Under the Medicaid Program for Workers with Disabilities
- Extending Medicare for SSDI Beneficiaries
- Demonstration of Coverage under the Medicaid Program of Workers with Potentially Severe Disabilities
- New Grant Programs
- Work Incentives Outreach Program
- State Grants for Work Incentives Assistance to Disabled Beneficiaries
- Grants to Develop and Establish State Infrastructures to Support Working Individuals with Disabilities
- SSDI Demonstration Authority and Project
- Studies and Reports
- Advisory Panel
On December 17, 1999 President Clinton signed into law The Ticket to Work and Work Incentives Improvement Act of 1999 (Public Law 106-170). Hereinafter in this policy brief, Public Law 106-170 will be referred to as "the Act".
The Act has four purposes [Section 2(b) of the Act]:
- To provide health care and employment preparation and placement services to individuals with disabilities that will enable those individuals to reduce their dependency on cash benefit programs.
- To encourage states to adopt the option of allowing individuals with disabilities to purchase Medicaid coverage that is necessary to enable such individuals to maintain employment.
- To provide individuals with disabilities the option of maintaining Medicare coverage while working.
- To establish a return to work ticket program that will allow individuals with disabilities to seek the services necessary to obtain and retain employment and reduce their dependency on cash benefit programs.
The purpose of this policy brief is to provide a background about Federal income maintenance and Federal health care programs, and to describe the major provisions in the Act relating to:
- Improving work incentives under the Social Security Disability Insurance Program (SSDI) and the Supplemental Security Income Program (SSI) and
- Expanding health care services under Medicare and Medicaid programs for persons with disabilities who are working or who want to work but fear losing their health care.
To the maximum extent feasible, descriptions contained in this policy brief incorporate or paraphrase descriptions set out in the conference report accompanying the Ticket to Work and Work Incentives Improvement Act of 1999.
A separate policy brief (Vol.2, No. 2) describes the major provisons in the Act creating the Ticket to Work and Self-Sufficiency Program.
Background about Federal Income Maintenance and Federal Health Care Programs
(prior to Enactment of the Act)
The SSDI Program
Title II of the Social Security Act establishes the Social Security Disability Insurance Program (SSDI). SSDI is a program of Federal disability insurance benefits for workers who have contributed to the Social Security trust funds and became disabled or blind before retirement age. Spouses with disabilities and dependent children of fully insured workers (often referred to as the primary beneficiary) also are eligible for disability benefits upon the retirement, disability, or death of the primary beneficiary. Section 202(d) of the Social Security Act also establishes the adult disabled child program which authorizes disability insurance payments to surviving children of retired, deceased or workers with disabilities who were eligible to receive Social Security benefits, if the child has a permanent disability originating before age 22.
Hereinafter in this policy brief, the term "SSDI" refers to all benefit payments made to individuals on the basis of disability under Title II of the Social Security Act.
SSDI provides monthly cash benefits paid directly to eligible persons with disabilities and their eligible dependents throughout the period of eligibility.
The SSI Program
Title XVI of the Social Security Act establishes the Supplemental Security Income Program (SSI). The SSI program is a means-tested program providing monthly cash income to low-income persons with limited resources on the basis of age and on the basis of blindness and disability for children and adults. The SSI program is funded out of the general revenues of the Treasury.
Eligibility for SSI is determined by certain Federally established income and resource standards. Individuals are eligible for SSI if their "countable" income falls below the Federal benefit rate ($512 for an individual and $769 for couples in 2000). States may supplement the Federal benefit rate. Not all income is counted for SSI purposes. Excluded from income are the first $20 of any monthly income (i.e., either unearned, such as social security and other pension benefits, or earned) and the first $65 of monthly earned income plus one-half of the remaining earnings. The Federal limit on resources is $2,000 for an individual and $3,000 for couples. Certain resources are not counted, including, for example, an individual's home and the first $4,500 of the current market value of an automobile.
The Definition of Disability under the SSDI and the SSI Programs
The definition of disability for purposes of initial eligibility is identical under the SSDI and SSI programs. Disability is defined as the inability to engage in any "substantial gainful activity" (SGA) by reason of a medically determinable physical or mental impairment that is expected to last for a continuous period of not less than 12 months, or to result in death. SGA is defined in Federal regulations as earnings of $700 per month.
After the initial determination of disability for applicants for the SSI program, SSI recipients can continue to be eligible for SSI on the basis of disability even when they have earnings in excess of the SGA earnings test applied at the initial determination of disability. In contrast, for SSDI recipients, earnings above SGA is considered in determining their continued disability status.
Work incentive provisions in the SSDI and SSI programs and related Federal health care programs.
Introduction. The SSDI and SSI programs in existence prior to the passage of the Act include a number of provisions designed to permit or encourage recipients to work.
Work incentives under the SSDI program. In the SSDI program, the work incentives provisions include:
- A trial work period (nine months) during which an individual may continue to receive cash benefits;
- A temporary extension of Medicare coverage for persons returning to work (4 years free Medicare Part A from the beginning of work activity);
- An extended eligibility period (36 months) to provide protection against the risks of an unsuccessful work attempt; and
- The exclusion of impairment-related work expenses in determining whether an individual is engaging in substantial gainful activity.
These bullets reflect the policy in the SSDI program that work incentives are time-limited.
For persons receiving SSDI benefits, earnings above a certain amount are considered an indication that they may no longer meet the definition of disability under the program. Work may eventually affect their eligibility for health services under the Medicare program. Loss of disability status under SSDI will also eventually affect their eligibility for specific disability-related health and long term support services in states which have chosen the Medicaid state option to provide Medicaid for low-income SSDI recipients under its "Medically Needy" program. The Medicaid program often includes services not available under the Medicare program or private health insurance e.g., personal attendant services and medications needed for persons with severe disabilities.
Work incentives under the SSI program. Since the SSI program was implemented in 1974, there have been work incentives for persons with severe disabilities.
- A portion of a SSI recipient's earned income is not counted in determining the amount of cash benefits they receive.
- Working individuals with no unearned income in a state without state supplementation will continue to receive a declining amount of SSI benefits as his or her earned income rises until he or she reaches the earned income breakeven point, which in 1999 is $1085 per month. (See description of Section 1619 (a) below.)
- Impairment-related work expenses can be excluded on an individualized basis.
- Certain income and resources are excluded for recipients who are participating in a time-limited plan for achieving self-support (PASS) as may be specified in individualized PASS plans.
In addition, in the SSI program, an individual whose earnings exceed the SGA earnings level can continue to receive SSI cash benefits and Medicaid under the provisions of Section 1619(a) of the Social Security Act as long as the individual meets the SSI income and resources tests. Further, an individual may retain his or her Medicaid eligibility as long as it is needed under specified circumstances under Section 1619(b) and Section 1905(q) of the Social Security Act even though he or she no longer receives SSI cash benefits (see below for more detailed description).
With respect to both the SSDI and SSI programs, a recipient enrolled in a vocational rehabilitation program may (under certain circumstances) continue to receive payment of cash benefits if he or she meets other requirements e.g., income and resource provisions in the SSI program, even if their impairment ceases.
The Medicare Program and SSDI Beneficiaries
Title XVIII of the Social Security Act establishes the Medicare program, which authorizes health insurance benefits for specified elderly persons and certain persons with disabilities (e.g., disabled workers receiving SSDI benefits). More specifically, individuals who have been entitled to SSDI benefits for 24 consecutive months are eligible to receive health insurance benefits under the Medicare program. The Medicare program is divided into three parts. Part A authorizes hospital insurance benefits; Part B provides supplemental medical insurance benefits; and Part C contains miscellaneous provisions, including coverage for end stage renal disease.
The Medicaid Program and SSI Beneficiaries
Title XIX of the Social Security Act establishes the Medicaid program. Medicaid is the Nation's major public financing program for providing health and long-term services and supports to low-income persons. Medicaid is a means-tested entitlement program financed by the state and Federal government out of general revenues. Within Federal guidelines, states set their own income and asset eligibility criteria for Medicaid services. Federal assistance is provided to states through Federal matching payment rates based on the state's per capita income.
Under Medicaid, states are required to serve some population groups and are permitted to serve others. Most states provide automatic eligibility for Medicaid to SSI recipients. Under Medicaid law, a state may include under the Medicaid program individuals who are "medically needy." Individuals are considered "medically needy" if they are determined to have severe disabilities (medical impairments and not working) and income too high to be eligible for SSI but low enough, after paying some of their health care bills, to meet the state's income criteria.
Under Section 1619(b) and Section 1905(q) of the Social Security Act, individuals can continue to be eligible for Medicaid even if their earned and unearned income make them no longer eligible for SSI benefits. This special eligibility status applies as long as the individual continues to have a disabling condition or is blind and meet the following additional criteria:
- Except for earnings, continues to meet all the other requirements for SSI eligibility;
- Would be seriously inhibited from continuing or obtaining employment if Medicaid eligibility were to end; and
- Has earnings that are not sufficient to provide a reasonable equivalency of benefits from SSI, state supplemental payments (if provided by the state), Medicaid, and publicly funded attendant care that would have been available in the absence of those earnings.
In making an initial determination under the criteria concerning reasonable equivalency of benefits, the Social Security Administration compares the individual's gross earnings to a "threshold" amount applicable to each state. The threshold established each year is based on the average expenditures for Medicaid benefits for disabled SSI cash recipients in the individual's state of residence plus the SSI and state supplement rates for an individual living alone. The threshold amount for states ranges from approximately $15,000 to $30,000. If the individual's earnings exceed the threshold, an individualized threshold can be calculated which considers the person's actual Medicaid use, work expenses, and publicly funded attendant care.
A recent change in law allows states to increase the income limit for Medicaid coverage of individuals with disabilities. The Balanced Budget Act of 1997 (Public Law 105-33) adds a new provision in the Medicaid program [Section 1902(a)(10)((A)(ii)(XIII) of the Social Security Act] that allows states to elect to provide Medicaid coverage to persons with disabilities who are working and who otherwise meet SSI eligibility criteria but have net income up to 250% of the Federal poverty guidelines. Beneficiaries under the more liberal income limit may "buy into" Medicaid by paying premium costs. Premiums are set on a sliding scale based on an individual's income, as established by the state. Medicaid law allows states to utilize more generous eligibility criteria than SSI rules related to unearned income and resources to provide Medicaid eligibility under this new option.
Under the Medicaid program, the Secretary of Health and Human Services is authorized to grant waivers to allow a state to offer home and community-based services and supports to individuals who, in the absence of such services, would require institutional care as long as costs (in the aggregate) under the waiver do not exceed the cost of providing institutional care to the target population. [Section 1915(c) of the Social Security Act] The Secretary may also grant waivers under the Medicaid program for demonstration projects. [Section 1115 of the Social Security Act]
PROVISIONS IN THE ACT
Reduction of Work Disincentives
Work Activity Standard as a Basis of Review of an Individual's Disabled Status. As explained above, prior to the passage of the Act, eligibility for SSDI requires an applicant to meet certain criteria, including the presence of a disability that renders the individual unable to engage in substantial gainful activity. Continuing disability reviews (CDRs) are conducted by the Social Security Administration to determine whether an individual remains disabled and thus eligible for continued benefits. CDRs can be triggered by evidence of recovery from disability, including return to work. The Social Security Administration is also required to conduct periodic CDRs every 3 years for beneficiaries with a nonpermanent disability and at times determined by the Commissioner for beneficiaries with a permanent disability.
Effective January 1, 2002, the Act establishes the standard that CDRs for a long-term SSDI beneficiary (i.e., an individual receiving disability benefits for at least 24 months) may not be scheduled for the individual solely as a result of the individual's work activity. The Social Security Administration would continue to evaluate work activity to determine whether eligibility for cash benefits continued (e.g., the individual has earnings that exceed the established level), but a return to work would not trigger a review of the beneficiary's impairment to determine whether it continued to be disabling. An individual would still be subject to a regularly scheduled periodic review. [Section 111 of the Act adds Section 221(m) to the Social Security Act and establishes the effective date for the amendment]
In addition, during any period for which an individual is using a "ticket" under the Ticket to Work and Self-sufficiency Program, the Commissioner (and any applicable state agency) may not initiate a continuing disability review or other review of whether the individual is or is not under a disability for purposes of the SSDI program. [Section 1148(i) of the Social Security Act, as added by Section 101(a) of the Act] This provision is effective when the Ticket program is effective and is applicable to both the SSI and SSDI programs.
Expedited Reinstatement of Disability Benefits. Prior to passage of the Act, individuals entitled to SSDI benefits received expedited reinstatement of benefits following termination of benefits because of work activity (i.e., termination due to performing at the substantial gainful activity level) any time during the 36 month extended period of eligibility so long as they continue to have a disabling impairment. In other words, during this period, benefits may be reinstated without a new application and disability determination.
Under the Act, effective the first day of the thirteenth month after the date of enactment of the Act, a SSDI beneficiary whose entitlement to SSDI benefits has been terminated due to the performance of SGA following the 36 month extended period of eligibility may request reinstatement of those benefits without filing a new application. The former SSDI beneficiary must be unable to engage in SGA due to his or her disability and the finding of disability must be the same as (or related to) the physical or mental impairment that gave rise to the initial finding of disability. The request for reinstatement may be filed within 60 consecutive months following the month the SSDI benefits were terminated. [Section 112 of the Act adds Section 223(i) to the Social Security Act and establishes the effective date for the amendment]
In contrast to the SSDI program, persons under the SSI program may move back and forth between SSI cash payment with Medicaid (SSI payment status under Section 1611 and 1619(a)) and non-cash payment status with Medicaid (SSI status under Section 1619(b) of the Social Security Act) without a time limit. SSI recipients who become ineligible for SSI cash benefits or SSI status under Section 1619(b) because of income or resources go into a suspension status for up to 12 months. They can be reinstated to SSI payment status or SSI status under Section 1619(b) without a new application if their income and resources are reduced to a level that they once again meet the SSI criteria if they are within 12 months of their loss of SSI payment status or SSI status under Section 1619(b). However, if an individual is past the 12-month suspension period time limit and loses his or her SSI status, the individual must make a new application for SSI on the basis of disability, income and resources.
Under the expedited reinstatement provision in the Act, those individuals who are no longer eligible for SSI cash benefits because of earned income (or earned and unearned income) may apply for reinstatement for eligibility for SSI cash benefits, even though they are no longer in the 12 month SSI suspension period time limit.
In order to apply for reinstatement, the former SSI recipient's disability must render the individual unable to perform SGA and the finding of disability must be the same as (or related to) the physical or mental impairment that gave rise to the initial finding of disability. In addition, the individual must satisfy the nonmedical requirements for SSI benefits. The request for reinstatement may be filed within 60 consecutive months beginning with the month following the most recent month for which the individual was eligible for SSI (including Section 1619) prior to the period of ineligibility.
The effective date of this provision is one year after the date of enactment of the Act. [Section 112 of the Act adds Section 1631(p) to the Social Security Act and established the effective date of the amendment]
Under the Act, while the Commissioner is making a determination pertaining to a reinstatement request under SSDI and SSI, the individual is eligible for provisional benefits (i.e., Federal cash benefits and Medicare and Medicaid, as appropriate) for a period of not more than 6 months. If the Commissioner makes a favorable determination, such individual's prior entitlement to benefits will be reinstated (as would the benefits of his or her dependents). If the Commissioner makes an unfavorable determination, provisional benefits would end, but the provisional benefits already paid would not be considered an overpayment (except under specified circumstances). [Section 112 of the Act adds Section 223(i) to the Social Security Act and Section 1631(p) to the Social Security Act]
Expanded Availability of Health Care Services
As explained above, under the law in effect prior to the passage of the Act, most states provide Medicaid coverage for disabled individuals who are eligible for SSI benefits. All states must provide Medicaid coverage to former SSI beneficiaries who currently meet the criteria set out in Section 1619(b) and Section 1905(q) of the Social Security Act. States may allow workers with disabilities to buy-into Medicaid under the Balanced Budget Act option if they have net income below 250% of the Federal poverty level.
Under the Act, effective October 1, 2000, states may establish one or two new optional Medicaid eligibility categories. [These options are authorized under Section 201 of the Act. Section 201 of the Act also establishes the effective date for these amendments.]
New Option 1.
States would have the option to cover individuals with disabilities (aged 16-64) who, except for earnings, would be eligible for SSI. In other words, states would be allowed to permit working individuals with disabilities with incomes above 250% of the Federal poverty level to buy-into the Medicaid program by paying premiums and other cost-sharing charges on a sliding-fee scale based on income. [Section 201(a)(1) of the Act adds a new Section 1902(a)(10)(A)(ii)(XV) to the Social Security Act]
New Option 2.
If and only if a state provides Medicaid coverage to individuals described in Option 1, the state would also have the option of providing coverage to employed persons with disabilities (aged 16-64) whose medical condition has improved (and as a result are no longer eligible for SSDI or SSI and therefore are no longer eligible for Medicaid) but who continue to have a severe medically determinable impairment as defined in regulations issued by the Secretary of HHS. [Section 201(a)(2) of the Act adds Section 1902(a)(10)(A)(ii)(XVI) to the Social Security Act]
Under both of these options, states could establish uniform limits on assets, resources, and earned or unearned income (or both) for this group that differ from the Federal SSI requirements. The state would be required to make premiums or other cost-sharing charges the same for both these two new eligibility groups. States may require individuals with incomes above 250% of the Federal poverty level to pay the full premium cost. In the case of individuals with incomes between 250 percent and 450 percent of the poverty level, premiums may not exceed 7.5 percent of income. States must require individuals with adjusted gross incomes above $75,000 per year (subject to annual adjustments after FY 2000) to pay all the premium costs. States may choose to subsidize premium costs for such individuals, but they may not use Federal matching funds to do so. [Section 201(a)(3) of the Act adds a new Section 1916(g) to the Social Security Act]
For the purposes of Option 2, individuals would be considered "employed" if they earn at least the Federal minimum wage and work at least 40 hours per month or are engaged in work that meets criteria for work, hours, or other measures established by the state and approved by the Secretary of HHS. [Section 201(a)(2) of the Act adds a new Section 1905(v) to the Social Security Act]
The Act requires that in order to receive Federal Medicaid funds, states must maintain the level of expenditures they expended in the most recent fiscal year prior to enactment of this provision to enable working individuals with disabilities to work. [Section 201(a)(4) of the Act adds a new Section 1903(i)(20) to the Social Security Act]
Extending Medicare for SSDI Beneficiaries.
As explained above, prior to the passage of the Act, SSDI beneficiaries are allowed to test their ability to work for at least nine months without affecting their SSDI (and therefore their Medicare) status. SSDI payments stop after a three-month grace period when a beneficiary has monthly earnings at or above substantial gainful employment after the nine-month period. If the beneficiary remains disabled but continues working, Medicare can continue for an additional 39 months (for a total of 48 months). Effective October 1, 2000, the Act provides for continued Medicare Part A coverage for 4 1/2 additional years (for a total of 8 1/2 years) without the payment of premiums. [Section 202(a) of the Act amends Section 226(b) of the Social Security Act. Section 202(b) of the Act establishes the effective date for the amendment.] Part B of Medicare benefits would continue to flow from continuing eligibility for Part A, but the Part B premium would apply as usual. A Medicare Buy In program is already available under current law which allows disabled workers to obtain Medicare. The result would be that after the 8 1/2 years disabled workers could continue to be covered under Medicare if their disability continues and if they pay a required premium under Medicare Part A and Part B.
Demonstration of Coverage under the Medicaid Program of Workers with Potentially Severe Disabilities.
Under the Act, a state may apply to the Secretary of HHS for approval of a demonstration project under which a specified maximum number of individuals who are workers with a potentially severe disability are provided medical assistance equal to that provided to workers with disabilities whose income does not exceed 250% of the Federal poverty level and who would be eligible for SSI, except for their earnings (the provision added by the Balanced Budget Act of 1997). In the case of a state that has not elected to provide medical assistance to these workers with disabilities, the state's demonstration project must provide such medical assistance as the Secretary determines is an appropriate equivalent to the medical assistance provided under such option. [Section 204(a) of the Act]
A "worker with a potentially severe disability" is an individual (aged 16-64) who is employed and has a specific physical or mental impairment that, as defined by the state, is reasonably expected, but for the receipt of medical assistance, to become blind or disabled as defined under the Social Security Act for purposes of the SSI program. [Section 204(b) of the Act] In accordance with the conference report, the States' definitions of workers with potentially severe disabilities can include individuals with a potentially severe disability that can be traced to congenital birth defects as well as diseases or injuries developed or incurred through illness or accident in childhood or adulthood.
Subject to the amount of funds appropriated for this demonstration, the Secretary must approve applications if the state demonstrates that it is maintaining fiscal effort and the state provides for an independent evaluation. The Secretary may allow for sub-state demonstrations (thereby waiving the statewide provision in the Medicaid legislation). [Section 204(c) of the Act]
Congress must appropriate $42 million for each of the fiscal years 2001-2004 and $41 million for each of the fiscal years 2005-2006. In no case may payments made to the states by the Secretary exceed $250 million in the aggregate. In addition, in no case may the payments made by the Secretary to the states for administrative expenses relating to annual reports exceed $2 million. [Section 204(c)(3) of the Act]
A state with an approved demonstration project must submit an annual report to the Secretary. [Section 204(d) of the Act] Not later than October 1, 2004, the Secretary must submit a report to the Congress regarding whether the demonstration project should be continued after fiscal year 2006. [Section 204(e) of the Act]
New Grant Programs
Work Incentives Outreach Program.
Under the Act, the Social Security Administration is required to establish a community-based work incentives planning and assistance program for the purpose of disseminating accurate information to individuals on work incentives. [Section 121 of the Act adds a new Section 1149 to the Social Security Act] Under the program, the Commissioner is required to:
- Establish a program of grants, cooperative agreements, or contracts to provide benefits planning and assistance (including information on the availability of protection and advocacy services) to individuals with disabilities and outreach to individuals with disabilities who are potentially eligible for work incentive programs; and
- Establish a corps of work incentive specialists located within the Social Security Administration.
The Commissioner is required to determine the qualifications of agencies eligible for grants, cooperative agreements, and contracts. Eligible organizations may include Centers for Independent Living, protection and advocacy organizations, client assistance programs, state Developmental Disabilities Councils, and state welfare agencies. State Medicaid agencies and Social Security field offices are ineligible.
Under the Act, Congress may appropriate $23 million for each of the fiscal years 2000-2004. The provision is effective on date of enactment.
State Grants for Work Incentives Assistance to Disabled Beneficiaries.
The Commissioner of the Social Security Administration is authorized to make grants to existing protection and advocacy systems established under the Developmental Disabilities Assistance and Bill of Rights Act to provide information and advice about obtaining vocational rehabilitation, employment services, advocacy, and other services a SSDI or SSI beneficiary may need to secure or regain gainful employment, including applying for and receiving work incentives. [Section 122 of the Act adds a new Section 1150 to the Social Security Act]
Under the Act, Congress may appropriate $7 million for each of the fiscal years 2000-2004. The provision is effective on the date of enactment.
Grants to Develop and Establish State Infrastructures to Support Working Individuals with Disabilities.
The Secretary of HHS must award grants to states to support the design, establishment, and operation of state infrastructures that provide items and services to support working individuals with disabilities. The Secretary must also award grants to states to conduct outreach campaigns regarding the existence of such infrastructures. [Section 203 of the Act]
In order to be eligible for a state infrastructure grant, a state must demonstrate that it makes personal assistance services available under its Medicaid plan to the extent necessary to enable individuals with disabilities to remain employed, including working individuals with disabilities with incomes up to 250% of poverty buying into Medicaid under the provision added by the Balanced Budget Act of 1997. The term "personal assistance services" means a range of services provided by one or more persons, designed to assist an individual with a disability to perform daily activities on and off the job that the individual would typically perform if the individual did not have a disability. Such services shall be designed to increase the individual's control in life and ability to perform every day activities on or off the job.
With respect to the amount of a state's infrastructure grant, the Act directs the Secretary of HHS to reward states that adopt the state Medicaid buy-in option for working individuals with disabilities with incomes up to 250% of poverty (as added by the Balanced Budget Act of 1997). States that choose not to adopt this option would be subject to a maximum grant award established by a methodology developed by the Secretary, consistent with the limit applied to states that take up the option.
States are required to submit an annual report to the Secretary on the use of grant funds. In addition, the report must indicate the percent increase in the number of SSDI and SSI beneficiaries who return to work.
The Act specifies that Congress must appropriate $20 million for fiscal year 2001, $25 million for fiscal year 2002, $30 million for fiscal year 2003, $35 million for fiscal year 2004, $40 million for fiscal year 2005, and for each of the fiscal years 2006-2011 an amount appropriated for the preceding fiscal year increased by the Consumer Price Index.
The Secretary, in consultation with the Ticket to Work and Work Incentives Advisory Panel is required to make a recommendation by October 1, 2010 to the Congress regarding whether the grant program should continue after fiscal year 2011.
SSDI Demonstration Authority and Projects
SSDI Demonstration Authority.
Section 505 of the Social Security Disability Amendments of 1980, as amended, provided the Commissioner of Social Security authority to conduct certain demonstration projects. The Commissioner was authorized to initiate experiments and demonstration projects to test ways to encourage SSDI beneficiaries to return to work, and was authorized to waive compliance with certain benefit requirements in connection with these projects. This demonstration authority expired on June 9, 1996. Effective as of the date of enactment, the Act extends the demonstration authority for five years and includes authority for demonstration projects involving applicants as well as beneficiaries. [Section 301 of the Act adds Section 234 to the Social Security Act]
Demonstration Projects Providing for Reductions in Disability Insurance Benefits Based on Earnings.
The Act requires the Commissioner of Social Security to conduct a demonstration project under which payments to SSDI beneficiaries would be reduced $1 for every $2 of beneficiary earnings above a level to be determined by the Commissioner. The Commissioner must annually report to the Congress on the progress of this demonstration project. [Section 302 of the Act]
Studies and Reports
GAO Report of Existing Disability-Related Employment Incentives.
The Act directs the GAO to assess the value of existing tax credits and disability-related employment initiatives under the Americans with Disabilities Act and other Federal laws. The report is to be submitted to specified committees of Congress within 3 years from the date of enactment of the Act. [Section 303(a) of the Act]
GAO Report of Existing Coordination of the SSDI and SSI Programs as They Relate to Individuals Entering or Leaving Concurrent Entitlement.
The Act directs the GAO to evaluate the coordination under current law of work incentives for individuals eligible for both SSDI and SSI. The report is to be submitted to specified committees of Congress within 3 years from the date of enactment of the Act. [Section 303(b) of the Act]
GAO Report on the Impact of the Substantial Gainful Activity Limit on Return to Work.
The Act directs the GAO to examine substantial gainful activity limit as a disincentive for return to work. The report must be submitted to specified committees of Congress within 2 years from the date of enactment of the Act. [Section 303(c) of the Act]
Report on Disregards Under the SSDI and the SSI Programs.
The Act directs the Commissioner of Social Security to identify all income disregards under the SSDI and SSI programs; to specify the most recent statutory or regulatory change in each disregard; the current value of any disregard if the disregard has been indexed for inflation; recommend any further changes, and to report certain additional information and recommendations on disregards related to grants, scholarships, or fellowships used in attending any educational institution. The report must be submitted to specified committees of Congress within 90 days from the date of enactment of the Act. [Section 303(d) of the Act]
GAO Report on SSA's Demonstration Authority.
The Act directs the GAO to assess the Social Security Administration's efforts to conduct disability demonstrations and to make a recommendation as to whether SSA's disability demonstration authority should be made permanent. The report must be submitted to specified committees of Congress within 5 years from the date of enactment of the Act. [Section 303(e) of the Act]
GAO Report on Amendments Expanding State Options Under The Medicaid Program for Workers with Disabilities.
The Act directs the GAO to submit a report to Congress not later than 3 years from the date of enactment regarding the amendments in the Act expanding state options under the Medicaid program for workers with disabilities. The report must examine the extent to which higher health care costs for individuals with disabilities at higher income levels deter employment or progress in employment; whether such individuals have health insurance coverage or could benefit from the state options established under the Act and how the states are exercising such options. [Section 201(c) of the Act]
GAO Report Regarding Extending Medicare Coverage.
The Act directs the GAO to submit a report to Congress no later than 5 years after the date of enactment that examines the effectiveness and cost of extending Medicare Part A coverage to working disabled persons without charging them a premium; the necessity and effectiveness of providing continuation of Medicare coverage to disabled individuals with incomes above the Social Security taxable wage base; the use of a sliding-scale premium for high-income disabled individuals; the viability of an employer-buy-in to Medicare; the interrelation between the use of continuation of Medicare coverage and private health insurance coverage; and that recommends whether the Medicare coverage extension should continue beyond the extended period provided under the Act.
The Act establishes a Ticket to Work and Work Incentives Advisory Panel. The panel must consist of 12 members with experience or expert knowledge as a recipient, provider, employer or employee in the fields of, or related to, employment services, vocational rehabilitation services, and other support services. At least one-half of the members must be individuals with disabilities or representatives of individuals with disabilities, with consideration given to current or former SSDI or SSI beneficiaries. [Section 101(f)(3) the Act]
The Panel is to advise the Commissioner and report to the Congress on the implementation of the Ticket to Work and Self-sufficiency Program, including such issues as the establishment of pilot sites, refinements to the program, and the design of program evaluations. In addition, the Panel is to advise the President, the Congress and the Commissioner on issues related to work incentives programs, planning, and assistance for individuals with disabilities, including work incentive provisions under the SSDI, SSI, Medicare and Medicaid programs. Further the Panel is to advise the Commissioner regarding the most effective designs for research and demonstration projects providing for reductions in disability insurance benefits based on earnings. [Section 101(f)(2) of the Act]
Policy Brief, Vol. 2, No. 1
This policy brief was written by Allen Jensen and Robert Silverstein of The Center for the Study and Advancement of Disability Policy (CSADP) at The George Washington University, School of Public Health and Health Services. The CSADP is a partner of the Rehabilitation Research and Training Center on State Systems and Employment at the Institute for Community Inclusion/UAP (#H133B30067), and the Rehabilitation Research and Training Center on Workforce Investment and Employment Policy at Community Options, Inc. (#H133B980042). The Centers are funded, in part, by the National Institute on Disability and Rehabilitation Research (NIDRR) of the US Department of Education. CSADP's work related to work incentives is funded, in part, by the Robert Wood Johnson Foundation. The opinions contained in this publication are those of the grantees and do not necessarily reflect those of the US Department of Education or the Robert Wood Johnson Foundation.
For more information on this study, please contact Robert Silverstein at (202) 783-5111 or Allen Jensen (202) 530-2319.